Recently, the Federal Reserve's actions over the past month have been quite interesting. Looking closely at the data, a single operation of 6.8 billion isn't particularly large, but with three consecutive operations within ten days totaling nearly 38 billion—this is clearly not a routine interest rate maintenance measure, but rather a concentrated injection of liquidity during year-end tight funding conditions.

On the surface, it's about "stabilizing the interest rate system," but the actual actions are quite straightforward. The current crypto market is extremely sensitive to liquidity; even a small breeze can trigger significant volatility. This sensitivity is much more pronounced than in previous years.

**Why are traders so focused on short-term liquidity?**

It's not complicated. At year-end, financial institutions generally face cash reserve pressures. When the Fed chooses to release liquidity at this time, it's like giving the entire market a boost. While it doesn't lead to excessive easing, it at least alleviates the year-end funding crunch.

However, it's important to understand that this is very different from the large-scale monetary easing in history. This is a short-term liquidity tool—some compare it to year-end overtime subsidies for employees—coming quickly and leaving just as fast. Essentially, it's a revolving door.

So, the question is: why does the crypto market tend to rally along with this?

The key lies in the change of funding channels. Since the approval of spot ETFs, traditional financial institutions have found it much easier to enter the crypto market. The short-term liquidity released by the Fed can spill over into the stock market and ultimately flow into crypto assets—especially those small- and mid-cap coins that are most sensitive to capital flows.

**Which assets are likely to benefit from this liquidity?**

Based on market performance, several clear features emerge:

Altcoins respond the fastest. Projects with smaller market caps and high topicality are more likely to become targets for short-term speculation. This is because smaller coins' price discovery mechanisms are more easily driven by liquidity.

BTC and ETH perform relatively steadily. After all, these two largest market cap coins appear calm in the face of hundreds of billions in liquidity injection—it's a minor matter. They more accurately reflect medium- to long-term supply and demand dynamics rather than short-term liquidity shocks.

From a short-term trading perspective, coins like SOL with medium market caps may be more worth watching. These coins are neither as sluggish as Bitcoin nor as volatile as small tokens; they often become focal points for short-term capital deployment. Technically, key resistance is around 135, with support near 123.

**How to grasp the market rhythm?**

In the short term, liquidity releases typically last 2-4 weeks. During this window, capital will seek the easiest upward-moving directions. Historical experience shows that this period is often when small- and mid-cap coins perform best.

But a reminder: this kind of liquidity-driven rally often lacks sustainability. Once this liquidity injection ends, funds tend to quickly withdraw from coins with weaker fundamentals. So, if you're participating in this wave, be especially mindful of risk management and position control.